A Firm Sells Its $1,000,000 Receivables to a Factor for $960,000.Average

question 68

Multiple Choice

A firm sells its $1,000,000 receivables to a factor for $960,000.Average collection period is one month.The effective annual rate is:

• A) 27.43%.
• B) 48.00%.
• C) 60.10%.
• D) 63.21%.

Analyze the financial impact of a buyer's breach on the seller.

Identify damages not recoverable by the seller due to breach.

Distinguish between the various legal remedies available under the Code and their common law counterparts.

Assess damages and remedies in a real-world scenario.

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Definitions:

Forecasting

The process of making predictions based on past and present data and analysis of trends, often used in planning inventory, sales, and other business operations.

Systematic Component

The part of a model or data that can be directly attributed to identifiable, potentially predictable, factors rather than random variation.

Seasonality

The periodic fluctuations in demand or activity levels experienced by businesses, often influenced by the time of year or season.

Adaptive Forecasting

A method in forecasting that adjusts its parameters and methods based on real-time feedback and data to improve future forecasts.